FOR IMMEDIATE RELEASE CONTACT: KEITH WINCHESTER
February 19, 2010 856-439-0300
CORNERSTONE FINANCIAL CORPORATION
REPORTS ENHANCED FOURTH QUARTER EARNINGS; ANNUAL RESULTS
Moorestown, NJ, February 19, 2010 - Cornerstone Financial Corporation (CFIC.OB),
the holding company for Cornerstone Bank, reported today that net income for the
fourth quarter of 2009 increased by $422 thousand over earnings in the prior
year's fourth quarter, to $460 thousand, or $0.25 per diluted share, as compared
to net income of $38 thousand, or $0.02 per diluted share, for the same period
in 2008 and net income of $269 thousand, or $0.15 per diluted share, for the
third quarter of 2009. The Company's net interest margin was 3.92% for the
fourth quarter of 2009, increasing from 3.33% in the fourth quarter of 2008 and
3.49% for the third quarter of 2009.
The improved quarterly performance reflects an increase in total interest income
of $674 thousand over the prior year, to $4.0 million from $3.3 million, and
$126 thousand over the third quarter of 2009. Net interest income increased by
$854 thousand over the year ago period and $389 thousand over the third quarter
of 2009. The increase in net interest income was partially offset by a $275
thousand increase in the provision for loan losses in the current fourth quarter
compared to the fourth quarter of 2008.
Total assets at December 31, 2009 were $306.1 million, an increase of $58.6
million or 23.7% over December 31, 2008. This change was primarily due to
increases in net loans receivable of $44.3 million and investments held to
maturity of $19.7 million.
Total deposits at December 31, 2009 were $249.4 million, an increase of $47.5
million or 23.5% from December 31, 2008. The increase in total deposits was
spread among non-interest bearing deposits, with an increase of $16.3 million,
certificates of deposit with an increase of $21.5 million, and an increase in
interest bearing core deposits of $9.7 million.
Gross loans receivable at December 31, 2009, totaled $238.4 million, an increase
of $44.3 million or 22.8% from December 31, 2008. This increase was attributable
to increases in commercial loans of $31.0 million, commercial real estate loans
of $14.6 million and partially offset by decreases in consumer loans of $839
thousand, construction loans of $216 thousand and residential real estate loans
of $204 thousand.
At December 31, 2009 our total non-performing assets were $8.1 million. This
represented 2.7% of our total assets at December 31, 2009 as compared to $281
thousand in other real estate owned and no non-accrual loans at year end 2008.
The non-performing assets consist of seven (7) non-accrual loan relationships.
The increase in non-performing assets over the course of 2009 reflects the
general economic slowdown in our marketplace coupled with the rise in
unemployment levels.
For the year ended December 31, 2009, Cornerstone Financial Corporation reported
a net loss of $565 thousand, or ($0.33) per share, as compared to a net loss of
$87 thousand, or ($0.05) per share, for 2008. The change in our results of
operations in 2009 reflects an increase of $2.1 million in net interest income,
offset by increases of $2.3 million in the provision for loan losses, $327
thousand in special assessment and regular FDIC insurance premium expense and
$407 thousand in increased salary and benefit costs, net occupancy costs and
other operating expenses incurred in connection with the Bank's expansion,
including costs relating to the Bank's Moorestown Main Street branch, which
opened in June 2008.
Cornerstone's Chairman, President, and CEO George W. Matteo, Jr. commented
"Although this past year has been filled with many challenges in our local and
national economy we are extremely pleased with the loan and deposit growth
experienced during the year ended December 31, 2009 and our improved level of
profitability in the fourth quarter continues the trend begun in the third
quarter." Mr. Matteo added: "The improvement in our fourth quarter earnings was
partially brought about by an improvement in our net interest margin. We were
able to increase our core deposit base and were able to reprice deposits at much
lower costs." Mr. Matteo continued, "We consider our fourth quarter earnings
performance to be noteworthy especially in the face of an extremely difficult
economic environment and the difficult and unsettled regulatory environment at
both the state and national level for today's banking industry".
Cornerstone Financial Corporation is a New Jersey based bank holding company
headquartered in Mount Laurel, New Jersey. Cornerstone Bank ("the Bank") is a
New Jersey state chartered commercial bank headquartered in Moorestown, New
Jersey. The Bank commenced operations on October 4, 1999, and conducts business
from its main office in Moorestown and from five additional branch offices
located in Medford, New Jersey, Burlington, New Jersey, Cherry Hill, New Jersey,
Voorhees New Jersey and Mount Laurel, New Jersey.
Set forth below is selected financial information concerning Cornerstone
Financial Corporation:
SELECTED BALANCE SHEET DATA December 31, December 31,
(In thousands) 2009 2008
------------ ------------
Unaudited Audited
Investments held to maturity $ 48,059 $ 28,398
Loans receivable 238,424 194,104
Allowance for loan losses 3,432 1,133
Total assets 306,144 247,535
Deposits 249,493 202,030
Advances from the Federal Home Loan Bank 29,883 26,257
Stockholders equity 17,813 15,378
Three months Three months
ended ended Year ended Year ended
SELECTED INCOME STATEMENT DATA December 31, December 31, December 31, December 31,
(In thousands except per share data) 2009 2008 2009 2008
-------------- ------------- ------------ ------------
Unaudited Audited Unaudited Audited
Interest income $ 3,999 $ 3,325 $ 14,840 $ 12,480
Interest expense 1,239 1,419 5,873 5,589
Net interest income 2,760 1,906 8,967 6,891
Provision for loan losses 179 (96) 2,530 221
Income (loss) before income taxes 744 52 (1,026) (251)
Net income (loss) 460 38 (565) (87)
EARNINGS PER SHARE
Basic $ 0.25 $ 0.02 $ (0.33) $ (0.05)
Diluted $ 0.26 $ 0.02 $ (0.33) $ (0.05)
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic 1,810 1,656 1,717 1,656
Diluted 1,768 1,656 1,717 1,656
FORWARD-LOOKING STATEMENTS
Cornerstone Financial Corporation (the "Company") may from time to time
make written or oral "forward-looking statements," including statements
contained in the Company's filings with the Securities and Exchange Commission
(including this Quarterly Report on Form 10-Q and the exhibits hereto), in its
reports to shareholders and in other communications by the Company, which are
made in good faith by the Company pursuant to the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995.
These forward-looking statements involve risks and uncertainties, such as
statements of the Company's plans, objectives, expectations, estimates and
intentions that are subject to change based on various important factors (many
of which are beyond the Company's control). Forward-looking statements may be
identified by the use of words such as "expects," "subject," "believe," "will,"
"intends," "will be," or "would." The factors which could cause the Company's
financial performance to differ materially from the plans, objectives,
expectations, estimates and intentions expressed in such forward-looking
statements include those items listed under "Item 1A-Risk Factors" in our Annual
Report on Form 10-K for the year ended December 31, 2008 and the following
factors, among others: the strength of the United States economy in general and
the strength of the local economies in which the Company conducts operations;
the effects of, and changes in, trade, monetary and fiscal policies and laws,
including interest rate policies of the Board of Governors of the Federal
Reserve System ("Federal Reserve"); inflation; interest rates; market and
monetary fluctuations; the timely development of new products and services by
the Company and the perceived overall value of these products and services by
users, including the features, pricing and quality compared to competitors'
products and services; the success of the Company in gaining regulatory approval
of its products, services, dividends and of new branches, when required; the
impact of changes in financial services laws and regulations (including laws
concerning taxes, banking, securities and insurance); technological changes;
acquisitions; the ability to continue to effectively manage costs, including the
costs incurred in connection with the opening of new branches; changes in
consumer spending and saving habits; and the success of the Company at managing
the risks resulting from these factors.